Topics: Privatization, Economics, Public ownership Pages: 4 (1325 words) Published: December 4, 2012
Privatisation has been seen as a ways of revitalising poorly industries and as a golden chance to raise revenues to simplicity budgetary problems. Many countries have used of privatisation in what has turned a worldwide phenomenon (Sloman and Sutcliffe, 2004, p.469). The wide-ranging privatisation programme in Malaysia covering railways, the national airlines, telecommunications, electricity and water services attracted appreciable domestic and foreign investment (Kim and Horn, 1999). The Malaysian government has identified five different policy objectives for its privatisation policy. However, the privatisation in Malaysia has resulted in both success and failure (Malaysian Economic Development, 2007). Also, privatisation will create the benefit and disadvantages to the country. The first benefit is that privatisation will expose the industries to market forces, from which will change the benefits of greater efficiency, massive growth and massive responsiveness to the desire of the consumers. The companies will face greater competition in the goods market and thus to keep their costs as low as possible in order to stay in business if the privatisation involved splitting an industries into competing companies. Shareholders will also enforce market discipline. Shareholders want a good return from their shares and will thus put pressure on the privatised company to perform well because the private sector’s ultimate goal is profit. This view has been supported in the book of Sloman and Sutciffe (2004, p.469). For example, there is the higher education in Malaysia. Sivalingam (2006) wrote that Higher education was a small sector and was monopolised by the public sector and there was appreciable public resistance to the constitution of private universities. The drift for the privatisation of higher education places limits on the enlargement of the public provision of higher education. The factor of the country to elite foreign universities to increase the supply of...
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